Cala predicts record full-year revenue, profits

Edinburgh-based upmarket home builder Cala Group said on Monday that a positive first-half trading performance is expected to lead to record revenues and profits for full-year 2018.

Cala — owned by Legal & General and Patron Capital — said it has also set a new, long term target of building more than 3,000 units per annum.

In a trading update for the six months to December 31, 2017, Cala said that after a strong period of trading where it delivered a 34% increase in total home completions to 939, it remains on course to deliver what would be its sixth record year of revenues and profits.

It said 20 new short‐term sites (1,571 plots) were contracted with potential gross development value (GDV) of £640 million.

Cala Group CEO Alan Brown said: “2017 was another excellent year for CALA and the first six months of the current financial year have seen us maintain the strong momentum generated by the business in recent years that has seen us become the UK’s fastest growing housebuilder by volume over the last decade.

“We have made exceptional progress in transforming the size and scope of our business and remain focused on scaling up our eight divisions as we continue to make significant progress towards achieving operational efficiency.

“The policy environment for the housebuilding sector improved further in 2017 and we were particularly encouraged by the £44 billion committed at the November Budget to boost the supply of new housing, alongside the ongoing focus on the development of urban areas.

“The UK continues to face an urgent shortage of housing but it is abundantly clear that there is cross‐party political support for a full range of initiatives to boost both construction and home ownership.

“However, while we have been increasingly encouraged by the direction of travel among policy makers, there remains far too much focus on landbanking with the latest review announced in November’s Budget the fifth of its kind since 2004.

“Instead of conducting yet another review of this nature, the Government would be better advised to review the approach to planning adopted by local authorities that continues to cause excessive planning delays.

“We are well placed to deliver what would be our sixth consecutive year of record revenues and profits and, as a result of our performance in recent years, the consistent delivery against our growth targets and the investments in the business we have made, longer term, we now believe that we have the capability to deliver over 3,000 units per annum from our current operating structure.”